Sell Bitcoins Directly to a Person

Selling bitcoins directly to another person can be one of the fastest and most anonymous ways to get bitcoins. In most cases, you won’t be required to provide documentation that proves your identity or wait for a verification period. And if selling bitcoins for cash face-to-face with another person, there is no need to disclose your name, address, or personal details.

The challenge is finding another trustworthy person willing to buy the amount of bitcoins you’re selling at a reasonable price, using an agreed upon payment method. Online marketplaces exist to help buyers and sellers find each other by allowing them to post ads of the amount of bitcoins they are buying or selling, and their desired price. Some of these websites, like localbitcoins.com, offer an escrow service that protects the Bitcoin seller from fraudulent buy offers. Additionally, some services’ built-in user feedback system can help you identify trustworthy people to trade with, as well as establish your own reputation.

bitcoin-otc is listing of buy offers and sell orders for currency and physical items. The service is non-proift, plays no part in trades other than listing them, and operates on a freenode IRC channel.

Escrow

User Feedback System

National Currencies

All

Supported Countries

All

Payment Methods

Not applicable

Fees

None

Verification Requirements

Bitcoin address and a GPG/PGP public key.

Physical Location

Not applicable

Advantages

The service is a simple aggregator of submitted orders: there is no centralized service that accepts Bitcoin deposits.

Disadvantages

Requires an IRC client to be installed and familiarity with GPG/PGP.

Low volume and diversity of orders.

No built-in escrow service: traders must find and commission a separate 3rd party for escrow.

Advantages

Person-to-person trades are usually faster than using an exchange.

Selling bitcoins for cash from another person is the most anonymous way to buy bitcoins.

Disadvantages

Many buyers will only pay lower prices so they can make a small profit for their time and service — you’ll usually end up getting a slightly smaller price per bitcoin than you would on an exchange.

Some Advice

Trade with users who have a high feedback score and a large number of trades. Most marketplaces track the reputations of traders via feedback. A trader’s reputation is important to their continued business because it establishes trust. So those traders have proven themselves to be trustworthy with others will have a high feedback score (around 100%) and typically a large number of trades. There is far less risk involved when doing business with an established trader.

Don’t keep a large amount of national currency or bitcoins deposited on a marketplace. There is always a risk that the service may suddenly shut down, and your funds will no longer be available to you (see the MtGox debacle). Try to only deposit the necessary amount, and then withdraw your bitcoins after trade or purchase is complete.

Use PGP/GPG encrypted messages for an extra layer of anonymity (advanced). Messages that you send to other traders on these marketplaces are stored in plain text on the service’s servers. Using PGP/GPG to encrypt these messages will help limit the visibility of personally identifying information (i.e. a meetup address, your real name, your shipping address, etc.) to only the person you’re trading with. Third parties, such as the marketplace service or law enforcement, will be unable to decipher the encrypted text. So when initiating a trade, first check if the buyer has a public PGP/GPG key and ask them to send it to you. You can then use it to encrypt sensitive text about yourself and the trade; the encrypted text will only be readable to the buyer. That is, of course, unless they decide to share it with others.